Good News for Homeowners who want to short sale with a second lien on their property. I have personally seen the process speed up in the last 6 months!
Rep. Jerry McNerney (D-Stockton) recently introduced a bill to speed up the short sale process by requiring subordinate mortgage lien holders to make a decision on a short sale within 45 days.
McNerney’s bill proposes that if the lender does not make a decision within the given time period, the short sale will be approved on the 46th day.
The bill, titled Fast Help For Homeowners (FHFH) Act, received strong support from the National Association of Realtors (NAR).
“Second mortgage lien holders frequently hold up and cancel the short sale transaction while trying to collect the largest possible payout in exchange for releasing the homeowner’s lien, even though the secondary lien holder often gets nothing if the home ends up going into foreclosure,” said NAR President Moe Veissi, in a statement. “While efforts have been made to improve primary lien holders’ response times, issues still abound with second and subsequent lien holders, and this legislation is a step in the right direction.”
The NAR also stated that its members continue to report delays in completing short sale transactions due to drawn out response times for whether or not an offer was accepted.
In a recent DS News interview with RealtyTrac VP Daren Blomquist, issues with second liens was also noted as problem for servicers when attempting to complete a short sale transaction.
The bill is cosponsored by Reps. Dennis Cardoza (D-California), Tom Rooney (R-Florida), George Miller (D-California), Jim Costa (D-California), Barbara Lee (D-California), and Richard Nugent (R-Florida).
By: Esther Cho 07/20/2012